Throughout the last few decades the banking sector in the British
Virgin Islands evolved to such an extent that it now plays an integral part
in the territory’s premier Financial Services sector.
The origin of banking in the BVI dates back to the 1960s, when the first banks
started operations in the territory. To date the industry has grown extensively
with six banks operating in what might be considered a small market.
The five commercial banks operating in the BVI are –
Scotiabank (British Virgin Islands); FirstCaribbean International Bank (formerly
Barclays Bank PLC – created as a result of merger between Barclays and
CIBC in the Caribbean); Banco Popular de Puerto Rico; First Bank; and the Development
Bank of the Virgin Islands. The sixth player, VP Bank is a Private Bank offering
comprehensive private and trust banking services to international and domestic
The primary focus of the local industry revolves around commercial
banking with assets and deposits growing substantially in terms of size and
range of products available. Over the years, the commercial banks have contributed
to the growth and development of individuals and businesses in the Virgin Islands
by providing various forms of financing for small businesses, mid and large
scale projects, as well as mortgages for individual consumers. This has evoked
a healthy business environment with all the local banks offering a wide range
of products and services on competitive terms.
Whilst the wider Financial Services sector is more dependent
upon various forms of investment banking, limited opportunities have meant that
the local banks have not been as active in this segment of the industry. That
is not to say that the local banks are not capable, and a number of them do
offer these services, but due to the nature of their origins, these types of
offerings are handled through the bank’s head offices in their parent
countries. Nevertheless, the investment banking arena in the BVI is changing
as major development projects are being progressed by private investors and
the Government, and hence is a potential area for growth.